Gazprom: Retroactive Censorship

The company’s Department for Information Policy has removed the Russian and English texts of Alexey Miller’s interview to the Süddeutsche Zeitung, dated early June 2011. This was when the boss of Gazprom referred to shale gas as ‘a sort of a Hollywood-made movie’, claimed that Russian gas in Europe was ‘too profitable’ for consumers, and threatened to switch the export flows from Europe to China.

It became awkward to keep presenting this nonsense as the official position of the company after President Vladimir Putin suddenly expressed an opposite view in October, acknowledging the existence of the ‘shale revolution’, challenge of LNG, competition in Asia, and the European nations’ desire to ‘create a common gas market.’ Whatever Miller had been telling the national leader in his regular reports made no sense any more.

Another item that has disappeared from the website of Gazprom is an article published in January by Sergey Komlev, the chief of the pricing group at Gazprom Export. The official was defending the principle of oil indexation for long-term gas contracts—and did it so awkwardly that Jonathan Stern and Howard Rogers at the Oxford Institute of Energy Studies had no difficulty showing the inconsistency of Komlev’s primitive apologies. Gazprom Export, they demonstrated in an OIES paper published on February 11, was jeopardizing the future of gas by pricing it out of the market.

Platts, commenting on this debate, stated that the arguments of Gazprom ‘have no calorific value and its customers are simply not buying them.’ In the final run, the conspicuous article of Komlev was removed from the website.

Deleting uncomfortable statements has been practiced by the censors of the Russian gas monopoly for a long time. In March 2007, for example, they erased all traces of information, published a year earlier, about the planned cost of the Altai pipeline project. The figures showed that the average price of one kilometer of that line would equal $1.8 mln. It contrasted strikingly with Gazprom’s average estimate for a kilometer of other pipelines, such as $4.8 mln for the Gryazovets-Vyborg (later raised to $6.3 mln), the Russian onshore leg of the Nord Stream project.

The cover-up operation of Gazprom censors may continue because the errata are too numerous to remain unnoticed. Miller’s public declarations are a great field for activity of this sort. When, for example, he said that his company had contracted 172 billion cubic meters of gas deliveries to Europe protected by the take-or-pay clause, the company’s prospect of share issue was presenting another figure, 158 billion. And it is just one of many such ‘slips of the tongue.’

The show will probably go on.

Published with the kind permission of RusEnergy. Mikhail Krutikhin is with RusEnergy, an independent privately-run company established in 2000 by a group of Russian experts with a long experience in consulting and publishing business. Based in Moscow, it specializes in monitoring, analysis and consulting on oil and gas industry of Russia, Central Asia, Azerbaijan and Ukraine.